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New consumer protections for building work

Hon Dr Nick Smith

Minister for Building and Construction
10 July 2014 Media Statement
New consumer protections for building work

Builders will be required to have written contracts, provide information on their relevant skills, experience and qualifications, and disclose their insurance and warranty cover from 1 January 2015 for residential building work valued at over $30,000, Building and Construction Minister Dr Nick Smith announced today.

"We need to improve how building work is contracted in New Zealand to ensure better quality work, improved affordability and fewer disputes. We need to replace a 'she'll be right' with a 'doing it right' culture, with increased professionalism, open disclosure and clear expectations about what work is to be done, at what price and in what timeframe," Dr Smith says.

"These new requirements come into effect 1 January 2015 and the industry needs to gear up for these significant changes. It is very encouraging to see the huge growth in building activity to reach their highest rates in a decade, but it is in these buoyant times when the risks are greatest for cutting corners and compromising quality. These requirements will reinforce the good practice of many building repairers while constraining cowboys only interested in making a quick buck.

"The new requirements were approved by Cabinet on Monday and were made under Part 4A of the Building Act amendments made in 2013. They apply to building work over a minimum price of $30,000. The new requirements are: a written contract (with specific clauses around warranties, dispute resolution, remedies); a checklist for consumers with tips on engaging builders and managing the project; and mandatory disclosure of information by building contractors (business information, key contacts and their role and qualifications, insurance cover held, warranties offered). Instant fines of $500 will be applied for failing to provide any of the above.

"These important new consumer protections are part of a wider programme of improving New Zealand's building industry. In the wake of problems over leaky buildings and the Canterbury earthquakes, we have introduced proper occupational regulation with the Licensed Buildering Practitioner Scheme, improved construction contracts law with amendments before Parliament, and have further work in progress to improve New Zealand's system of standards.

"Our goal is an efficient building industry that is capable of delivering the quantity of quality and affordable homes that New Zealand needs," Dr Smith concluded.

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